Inflation, interest rates and tariffs mean 2025 is shaping up to be an intriguing year for the global economy. One in which growth is expected to remain at a "stable yet underwhelming" 3.2%, according to the International Monetary Fund. So what might that mean for all of us? Exactly a week before Christmas there was a welcome gift for millions of American borrowers - a third interest rate cut in a row. However, stock markets fell sharply because the world's most powerful central banker, US Federal Reserve chair Jerome Powell, made clear they shouldn't expect as many further cuts in 2025 as they might have hoped for, as the battle against inflation continues. "From here, it's a new phase, and we're going to be cautious about further cuts," he said. In recent years, the Covid pandemic and the war in Ukraine have led to sharp price rises around the world, and although prices are still increasing the pace has slowed markedly. Despite that, November saw inflation push up in the US, eurozone and UK to to 2.7%, 2.2% and 2.6% respectively. It highlights the difficulties many central banks face in the so-called "last mile" of their battle against inflation. Their target is 2%, and it might be easier to achieve if economies are growing. However, the biggest difficulty for global growth "is uncertainty, and the uncertainty is coming from what may come out of the US under Trump 2.0", says Luis Oganes, who is head of global macro research at investment bank JP Morgan. Since Donald Trump won November's election he's continued to threaten new tariffs against key US trading partners, China, Canada and Mexico. "The US is going into a more isolationist policy stance, raising tariffs, trying to provide more effective protection to US manufacturing," says Mr Oganes. "And even though that is going to support US growth, at least in the short term, certainly it's going to hurt many countries that rely on trade with the US." New tariffs "could be particularly devastating" for Mexico and Canada, but also be "harmful" to the US, according to Maurice Obstfeld, a former chief economist at the International Monetary Fund, and a previous economic advisor to President Obama. He cites car manufacturing as an example of an industry that "depends on a supply chain that is spread across the three countries. If you disrupt that supply chain, you have massive disruptions in the auto market". That has the potential to push up prices, reduce demand for products, and hurt company profits, which could in turn drag down investment levels, he explains. Mr Obstfeld, who is now with the Peterson Institute for International Economics, adds: "Introducing these types of tariffs into a world that is heavily dependent on trade could be harmful to growth, could throw the world into recession." The tariffs threats have also played a role in forcing the resignation of Canada's Prime Minister Justin Trudeau. Even though the majority of what the US and China sell each other is already subject to tariffs from Donald Trump's first term in office, the threat of new tariffs is a key challenge for the world's second-biggest economy in the year ahead. In his new year address President Xi Jinping acknowledged the "challenges of uncertainties in the external environment", but said the economy was on "an upward trajectory". Exports of cheap goods from its factories are crucial to China's economy. A drop off in demand because tariffs push prices up would compound the many domestic challenges, including weak consumer spending and business investment, that the government is trying to tackle. Those efforts are helping, according to the World Bank, which at the end of December increased its forecast for China's growth from 4.1% to 4.5% in 2025. Beijing has yet to set a growth target for 2025, but thinks it's on course for 5% last year. "Addressing challenges in the property sector, strengthening social safety nets, and improving local government finances will be essential to unlocking a sustained recovery," according to the World Bank's country director for China, Mara Warwick. Those domestic struggles mean the Chinese government is "more welcoming" of foreign investment, according to Michael Hart, who is president of the American Chamber of Commerce in China. Tensions between the US and China, and tariffs have grown under the Biden presidency, meaning some companies have looked to move production elsewhere. However, Mr Hart points out that "it took 30 to 40 years for China to emerge as such a strong supplier manufacturer", and whilst "companies have tried to mitigate some of those risks... no one's prepared now to completely replace China." One industry that is likely to continue to be at the heart of global trade battles is electric vehicles. More than 10 million were made in China last year, and that dominance led the US, Canada and European Union (EU) to impose tariffs on them. Beijing says they're unfair, and is challenging them at the World Trade Organization. However, it's the prospect of Donald Trump imposing tariffs that is concerning the EU. "Restrictions on trade, protectionist measures, are not conducive to growth, and ultimately have an impact on inflation that is largely uncertain," the president of the European Central Bank, Christine Lagarde, said last month. "[But] in the short term, it's probably net inflationary." Germany and France are the traditional engines of Europe's economic growth. But their poor performance amid political instability over the past year means that, despite a recent uptick in growth, the eurozone risks losing momentum in the year ahead. That is, unless consumers spend more and businesses increase their investments. In the UK higher prices could also come as a result of tax and wage increases, according to one survey. One barrier to cutting eurozone interest rates is that domestic inflation, which focuses on the prices of items that are less prone to influence from external factors, remains at 4.2%. That's more than double the overall inflation target of 2%, and strong wage pressure has been a barrier getting it down further. It's been similar in the US according to Sander van 't Noordende, the chief executive of Randstad, the world's biggest recruitment firm. "In the US, for instance, [wage inflation] is still going to be around 4% in 2024. In some Western European countries, it's even higher than that. "I think there's two factors there. There's the talent scarcity, but there's also, of course, the inflation and people demanding to get more for the work they do." Mr van 't Noordende adds that many companies are passing those extra costs on to their customers, which is adding upward pressure to general inflation. A slowdown in the global jobs market reflects a lack of "dynamism" from companies and economic growth is key to reversing that, he says. "If the economy is doing well, businesses are growing, they start hiring. People see interesting opportunities, and you just start seeing people moving around". One person starting a new role in 2025 is Donald Trump, and a raft of economic plans including tax cuts and deregulation could help the US economy to continue to thrive. Whilst much won't be revealed before he's back in the White House on 20 January, "everything points to continued US exceptionalism at the expense of the rest of the world," says JP Morgan's Mr Oganes. He's hopeful that inflation and interest rates can continue to come down around the world, but warns that "a lot of it will depend on what are the policies that get deployed, particularly from the US."

Canadian Prime Minister Justin Trudeau has hit back at Donald Trump's threat to use "economic force" to absorb Canada into the US saying there isn't "a snowball's chance in hell" to join the two. President-elect Trump has in recent weeks repeatedly needled Canada about it becoming the 51st US state. "You get rid of that artificially drawn line, and you take a look at what that looks like, and it would also be much better for national security," Trump said at a press conference at his Florida Mar-a Lago home on Tuesday. "Canada and the United States, that would really be something." Trump reiterated his threat to bring in a "substantial" tariff on Canadian goods unless the country took steps to increase security on the shared US border. The ongoing tariff threat comes at a politically challenging time for Canada. On Monday, an embattled Trudeau announced he was resigning, though he will stay on as prime minister until the governing Liberals elect a new leader, expected sometime by late March. Canada's parliament has been prorogued - or suspended - until 24 March to allow time for the leadership race. Economists warn that if Trump follows through on imposing the tariffs after he is inaugurated on 20 January, it would significantly hurt Canada's economy. Almost C$3.6bn ($2.5bn) worth of goods and services crossed the border daily in 2023, according to Canadian government figures. The Trudeau government has said it is considering imposing counter-tariffs if Trump follows through on the threat. The prime minister also said on X on Tuesday that: "Workers and communities in both our countries benefit from being each other's biggest trading and security partner." During his lengthy Mar-a-Lago press conference, Trump reiterated his concerns he has expressed about drugs crossing the borders of Mexico and Canada into the US. Like Canada, Mexico faces a 25% tariff threat. The amount of fentanyl seized at the US-Canada border is significantly lower than at the southern border, according to US data. Canada has promised to implement a set of sweeping new security measures along the border, including strengthened surveillance and adding a joint "strike force" to target transnational organised crime. Trump said on Tuesday he was not considering using military force to make Canada part of the United States, but raised concerns about its neighbour's military spending. "They have a very small military. They rely on our military. It's all fine, but, you know, they got to pay for that. It's very unfair," he said. Canada has been under pressure to increase its military spending as it continues to fall short of the target set out for Nato members. Its defence budget currently stands at C$27bn ($19.8bn, £15.5bn), though the Trudeau government has promised that it will boost spending to almost C$50bn by 2030. British Columbia Premier David Eby told a news conference on Tuesday that a number of Canadian provincial premiers will soon be travelling to Washington DC to lobby against the possible tariffs. On Monday, Doug Ford, the leader of Canada's most populous province Ontario, said Trudeau must spend his remaining weeks in office working with the provinces to address Trump's threat. "The premiers are leading the country right now," he told BBC News in an interview. What happens next for Canada? When will Donald Trump take office as US president? Ontario has a deep reliance on trade with the US. The province is at the heart of the highly integrated auto industry in Canada, and trade between Ontario and the US totalled more than C$493bn ($350bn) in 2023. "My message is let's work together, let's build a stronger trade relationship - not weaken it," Ford said. The premier warned "we will retaliate hard" if the Trump administration follows through, and highlighted the close economic ties between the two nations, including on energy. The US relies "on Ontario for their electricity. We keep the lights on to a million and a half homes and businesses in the US", he said. At a press conference early this week, Ford also pushed back on Trump's 51st state comments. "I'll make him a counter-offer. How about if we buy Alaska and we throw in Minneapolis and Minnesota at the same time?" Ford said.

President-elect Donald Trump has reiterated his desire for the US to acquire Greenland and the Panama Canal, calling both critical to American national security. Asked if he would rule out using military or economic force in order to take over the autonomous Danish territory or the Canal, he responded: "No, I can't assure you on either of those two. "But I can say this, we need them for economic security," he told reporters during a wide-ranging news conference at his Mar-a-Lago estate in Florida. Both Denmark and Panama have rejected any suggestion that they would give up territory. Trump also vowed to use "economic force" when asked if he would attempt to annex Canada and called their shared border an "artificially drawn line". The boundary is the world's longest between two countries and it was established in treaties dating back to the founding of the US in the late 1700s. The president-elect said the US spends billions of dollars protecting Canada, and he criticised imports of Canadian cars, lumber and dairy products. "They should be a state," he told reporters. But outgoing Canadian Prime Minister Justin Trudeau said there isn't "a snowball's chance in hell" of the two countries merging. Trudeau says 'not a snowball's chance in hell' Canada will join US Trump's eyeing Greenland - but other Arctic investment is frozen When does Donald Trump take office as US president? Trump's news conference - less than two weeks before he is sworn in for a second term - was initially billed as an economic announcement to unveil a $20bn (£16bn) investment from Dubai developer Damac Properties to build data centres in the US. But in a free-wheeling appearance, the president-elect went on to criticise environmental regulations, the US election system, the various legal cases against him, and President Joe Biden. Among other things, he suggested renaming the Gulf of Mexico the "Gulf of America" and restated his opposition to wind power, saying wind turbines are "driving the whales crazy". His remarks came as his son, Donald Trump Jr, visited Greenland. Before arriving by private jet in the capital Nuuk, Trump Jr said he was going on a "personal day trip" to talk to people, and had no meetings planned with government officials. When asked about Trump Jr's visit to Greenland, Danish Prime Minister Mette Frederiksen told Danish TV that "Greenland belongs to the Greenlanders" and that only the local population could determine its future. She said "Greenland is not for sale", but stressed Denmark needed close co-operation with the US, a Nato ally. Greenland - which has a population of just 57,000 - is the world's largest island and is a strategically important part of the Arctic region. It has wide-ranging autonomy, but its economy is largely dependent on subsidies from Copenhagen and it remains part of the kingdom of Denmark. Greenland is also home to a large American space facility and has some of the largest deposits of rare earth minerals, which are crucial in the manufacture of batteries and high-tech devices. Trump suggested the island is crucial to military efforts to track Chinese and Russian ships, which he said are "all over the place". "I'm talking about protecting the free world," he told reporters. Since winning re-election Trump has repeatedly returned to the idea of US territorial expansion - including taking back the Panama Canal. During the news conference, Trump said the canal "is vital to our country" and claimed "it's being operated by China". He previously accused Panama of overcharging US ships to use the waterway, which connects the Atlantic and Pacific oceans. Panamanian President José Raúl Mulino has rejected Trump's claims and said there is "absolutely no Chinese interference" in the canal. A Hong Kong-based company, CK Hutchison Holdings, manages two ports at the canal's entrances. The canal was built in the early 1900s and the US maintained control over the canal zone until 1977, when treaties negotiated under President Jimmy Carter gradually ceded the land back to Panama. "Giving the Panama Canal to Panama was a very big mistake," Trump said. "Look, [Carter] was a good man... But that was a big mistake." It's unclear how serious the president-elect is about adding to the territory of the US, particularly when it comes to Canada, a country of 41 million people and the second-largest nation by area in the world. During the news conference, Trump also repeated a number of falsehoods and odd conspiracy theories, including suggesting that Hezbollah, the Islamist militant group, was involved in the US Capitol riot of 2021.

For months now, Canada's Prime Minister Justin Trudeau has been asked variations of the same question: "Will you step down?" But though he vowed to stay on as Liberal Party leader - despite deepening frustrations amongst voters and a political rival surging in the polls - even the self-described "fighter" could not withstand the growing chorus of members of his own party calling for him to resign. "This country deserves a real choice in the next election, and it has become clear to me that if I'm having to fight internal battles, I cannot be the best option in that election," Trudeau conceded on Monday, announcing his resignation in front of Rideau Cottage, his official residence for most of the last decade. He will stay on as prime minister until a new Liberal Party leader is chosen, at a date yet to be set by the party. Trudeau asked for parliament to be prorogued - or suspended - until 24 March to give time for the party to find a new leader. Who might replace Trudeau as Liberal Party leader? Trudeau swept to power nearly a decade ago, heralded as the fresh face of progressive politics. In 2015, swayed by his youthful charisma and a hopeful political message, voters catapulted the Liberals from a third-place party to holding a majority of seats in parliament - unprecedented in Canadian political history. Now, he remains the only leader left standing among peers when he came into office, from Barack Obama to Angela Merkel, Shinzo Abe and David Cameron, and at 53 years old, is currently the longest-serving leader in the G7. But in the years since his ascent to the global stage, and over two general elections, Trudeau and his brand have become a drag on the party's fortunes. Paul Wells, a Canadian political journalist and the author of Justin Trudeau on the Ropes, recently told the BBC he believes Trudeau will be remembered "as a consequential" prime minister, notably for providing genuine leadership on issues like indigenous reconciliation and, to some extent, climate policy. But he is also one "who felt increasingly out of touch with public opinion and was increasingly unable to adjust to changing times". On Monday, Trudeau was quick to tout what he was proud of accomplishing in office, including navigating the tumultuous Covid pandemic, renegotiating a free trade deal with the last Trump administration, and implementing a child benefit widely seen as helping alleviate poverty. But a series of ethics scandals early on began to take the sheen off the new government - he was found to have violated federal conflict of interest rules in the handling of a corruption inquiry – the SNC-Lavalin affair - and for luxury trips to the Bahamas. In 2020, he faced scrutiny for picking a charity with ties to his family to manage a major government programme. In a general election in 2019, his party was reduced to a minority status, meaning the Liberals had to rely on the support of other parties to stay in power. A snap election in 2021 did not improve their fortunes. More recently, Trudeau faced headwinds from cost of living increases and inflation that have contributed to election upsets around the world. There was also frustration in the country over what was seen as struggles to deliver on big promises - an agenda that was "overfilled, overstuffed", said Mr Wells - and his handling of issues like immigration. Late last year, the Liberals backtracked on ambitious immigration targets over concerns the issue was mismanaged, significantly cutting back on the number of newcomers allowed in Canada. He also sometimes handed his opponents easy political wins, including when it came to light that he had worn black and brown face before holding office. Justin Trudeau's resignation speech in full What happens next for Canada? After more than nine years in power, he is among Canada's longest serving prime ministers, and there is a general sense of fatigue and frustration with his government. So the writing was on the wall.

After weeks of mounting pressure to step down, Justin Trudeau has announced he will resign as Canada's prime minister and as leader of the Liberal Party of Canada. The resignation brings a long political chapter to an end. Trudeau has been in office since 2015, when he brought the Liberals back to power from the political wilderness. Trudeau said he will remain at the helm until a new Liberal leader is selected. But many questions remain for the party, including who will take over and how they will manage a looming federal election. So what happens next? What is a prorogued Parliament? Addressing Canadians on Monday, Trudeau said the country's governor general had accepted his request to prorogue Parliament - essentially a suspension that will stop all proceedings, including debates and votes, without dissolving parliament. While a routine part of parliamentary procedure, it is sometimes used by governments to buy time during a political crisis. Parliament was most recently prorogued by Trudeau in August 2020, when his government was facing an ethics scandal over its handling of a contract with a charity. This latest prorogation will freeze parliament until 24 March. Trudeau defiant in face of turmoil Trudeau facing cold reality after lonely week on world stage Who will lead the Liberals? It is likely the Liberal caucus will try to have a new leader in place by the end of the prorogation period, though it is so far unclear how that leader will be chosen. Typically, leaders of Canada's federal parties are chosen over a four or five month period, a process that includes a formal leadership convention. On Monday, Trudeau said a new leader would be chosen through a "robust, nationwide, competitive process". The president of the Liberal party, Sachit Mehra, said soon afterwards the party would convene a meeting of its national board this week to select a new leader. There is no clear successor to Trudeau, but several prominent Liberals including former Finance Minister Chrystia Freeland, Transport Minister Anita Anand and formal central banker Mark Carney have been floated as possible leaders. When is Canada's election? Canada must have its next federal election by October, but it's likely a vote will be called before that. Riding high in opinion polls with a double-digit lead, the official opposition Conservative Party have tried for months to trigger an election by bringing a series of no-confidence votes in the House of Commons. The government needs the backing of a majority of the 338 members of parliament in a no-confidence vote. The Liberals are 17 seats shy of that, meaning they require support from members of Canada's other parties. So far, members of the left-leaning New Democratic Party (NDP) have supplied Trudeau with enough votes to maintain control. But on Monday, after Trudeau announced he would step aside, NDP Leader Jagmeet Singh said he would vote to bring down the Liberal Party, no matter who the leader is. "They do not deserve another chance," he said. Whoever is in charge of the Liberals by 24 March will not have much time to govern. And after prorogation ends, the first vote will be a confidence motion. If the government loses that confidence motion, it is expected to resign or seek the dissolution of parliament, triggering a federal election. Polls indicate that if a Canadian election were to be held today, the official opposition Conservative Party would win decisively. Who is Pierre Poilievre? Pierre Poilievre is the leader of Canada's Conservative Party. If opinion polls are any indication, he is odds-on favourite to be Canada's next prime minister. Since taking over his party in 2022, Poilievre has been an especially formidable opponent to the prime minister, frequently calling on Trudeau to bring an early election. Poilievre has branded himself as anti-elite and anti-Trudeau, a down-to-earth everyman. He was ejected from Parliament in April after refusing to apologise for calling Trudeau a "wacko" and "extremist" during a question period.

Under growing pressure from his own party, Canadian Prime Minister Justin Trudeau has announced he will step down and end his nine-year stretch as leader. Trudeau said he would stay on in office until his Liberal Party can choose a new leader, and that parliament would be prorogued - or suspended - until 24 March. "This country deserves a real choice in the next election and it has become clear to me that if I'm having to fight internal battles, I cannot be the best option in that election," he said during a press conference Monday. Trudeau's personal unpopularity with Canadians had become an increasing drag on his party's fortunes in advance of federal elections later this year. "Last night, over dinner, I told my kids about the decision that I'm sharing with you today," he told the news conference in Ottawa. "I intend to resign as party leader, as prime minister, after the party selects its next leader through a robust nationwide competitive process," he said. The president of the Liberal Party, Sachit Mehra, said a meeting of the party's board of directors would be held this week to begin the process of selecting a new leader. Who might replace Trudeau as Liberal Party leader? Why the Trudeau era has come to an end now What happens next for Canada? In a statement, he added: "Liberals across the country are immensely grateful to Justin Trudeau for more than a decade of leadership to our Party and the country." "As Prime Minister, his vision delivered transformational progress for Canadians," he said, citing programmes his government has implemented like the Canada Child Benefit and the establishment of dental care and pharmacare coverage for some medication. Conservative leader Pierre Poilievre said "nothing has changed" following Trudeau's resignation. "Every Liberal MP and Leadership contender supported EVERYTHING Trudeau did for 9 years, and now they want to trick voters by swapping in another Liberal face to keep ripping off Canadians for another 4 years, just like Justin," Poilievre wrote on X. Trudeau, 53, had faced growing calls to quit from inside his Liberal Party, which ramped up in December when deputy prime minister and long-time ally Chrystia Freeland abruptly resigned. In a public resignation letter, Freeland cited US President-elect Donald Trump's threats of tariffs on Canadian goods, and accused Trudeau of not doing enough to address the "grave challenge" posed by Trump's proposals. Trump has promised to impose a tax of 25% on imported Canadian goods - which economists have warned would significantly hurt Canada's economy - unless the country takes steps to increase security on its shared border. Trudeau said Monday that he had hoped Freeland would have continued as deputy prime minister, "but she chose otherwise". Canada has since announced that it will implement sweeping new security measures along the country's US border in response to the threat. In an online post, Trump claimed that pressure over tariffs led to Trudeau's resignation and repeated his jibe that Canada should become "the 51st State". "If Canada merged with the U.S., there would be no Tariffs, taxes would go way down, and they would be TOTALLY SECURE from the threat of the Russian and Chinese Ships that are constantly surrounding them," he wrote. Since 2019, the Liberal Party has governed as a minority party. Following Freeland's resignation, Trudeau lost the backing of parties that had previously helped keep the Liberals in power - the left-leaning New Democrats, who had a support agreement with the Liberals, and the Quebec nationalist party, Bloc Quebecois. The largest opposition party, the Conservatives, have maintained a significant two-digit lead over the Liberals in polls for months - suggesting that if a general election were held today, the Liberals could be in for a significant defeat. Liberals will now choose a new leader to take the party into the next election, which must be held on or before 20 October. A senior government official told the BBC that the race is an open contest, and that the Prime Minister's Office will fully stay out of the process, leaving it to Liberal Party members to decide their future. Speaking to reporters, the Bloc Quebecois leader Yves-François Blanchet suggested that an early election be called once the Liberals choose their new leader. End of the Trudeau era Trudeau is the son of Canadian Prime Minister Pierre Trudeau, who dominated the country's politics in the 1970s and '80s. The younger Trudeau became prime minister after the Liberal Party won a sweeping majority in 2015 amid a promise to usher in a new, progressive era of "Sunny Ways". His record includes a commitment to gender equality in his cabinet, which continues to be 50% women; progress on reconciliation with Indigenous people in Canada; bringing in a national carbon tax; implementing a tax-free child benefit for families; and legalising recreational cannabis. Assembly of First Nations National Chief Cindy Woodhouse Nepinak praised Trudeau's track record on indigenous issues following his resignation, saying in a statement that he "has taken meaningful steps to address issues that matter to First Nations". "While much work remains, these actions have laid a foundation for future governments to build upon." Clouds began to hang over Trudeau's government in recent years, which weathered a series of often self-inflicted scandals, including a controversy over a deal with a Canadian firm facing corruption charges and photos that emerged of the prime minister wearing brownface makeup prior to his time in politics. Vaccine mandates and other restrictions were also met with fierce backlash by some Canadians, leading to the Freedom Convoy truck protests in early 2022. Trudeau eventually used unprecedented emergency powers to remove the protesters. As Canada began to emerge from the pandemic, housing and food prices skyrocketed, and his government pulled back on ambitious immigration targets as public services began to show strain. By late 2024, Trudeau's approval rating was at its lowest - just 22% of Canadians saying they thought he was doing a good job, according to one polling tracker. In Ottawa, a small group of protestors danced outside Parliament Hill in celebration of his resignation. One passer-by, however, said he thinks things were fine under Trudeau's watch. "I'm a carpenter," Hames Gamarra, who is from British Columbia, told the BBC. "I mind my own business, I get my wages, I pay the bills. It's been OK." Another Canadian, Marise Cassivi, said it feels like the end of an era. Asked if she feels any hints of sadness, she replied: "No." "It's the right thing."

The former governor of the Bank of Canada and the Bank of England, Mark Carney, says he is "considering" entering the race to replace Justin Trudeau as the leader of Canada's Liberal Party. Trudeau said on Monday he would step down after nine years as Canadian prime minister - following growing pressure from his own party and poor opinion polling. Mr Carney, 59, is one of several names in the frame to replace Trudeau, along with his former deputy Chrystia Freeland and Transport Minister Anita Anand. Trudeau says he will stay in office until a new leader is chosen. In the meantime, the Canadian parliament has been prorogued - or suspended - until 24 March. It is likely the Liberals will try to have a new leader in place by the end of the prorogation period - though the timeline and procedure remain unclear. Trudeau has promised a "robust, nationwide, competitive process". Mr Carney, who leads an asset management firm and has worked as a Trudeau adviser, told the UK's Financial Times newspaper: "I'll be considering this decision closely with my family over the coming days." He has long been considered a contender for the top job, though he has never held public office despite his economic background. During his career as a central banker - at the Bank of Canada from 2007-2013 and then at the Bank of England from 2013-2020 - Mr Carney was influential in the response of two major economies to the global financial crisis. He also led efforts to support the UK economy through its exit from the European Union and the outbreak of Covid-19. Why Trudeau era has come to an end now What next for Canada? Other names in the frame to replace Trudeau Whoever succeeds Trudeau in Canada could face an immediate test. The country must have its next federal election by October, but it is considered likely that a vote will be called before that. The opposition Conservative Party, led by Pierre Poilievre, currently enjoy a double-digit lead in the opinion polls. Trudeau himself recently admitted that he had long been trying to recruit Mr Carney to his team, most recently as finance minister. "He would be an outstanding addition at a time when Canadians need good people to step up in politics," he said last year. Mr Carney would also bring expertise on environmental matters through his role as the United Nations special envoy on climate action, recently calling the goal of net zero "the greatest commercial opportunity of our time". He is a champion of some Liberal policies that have been unpopular within the country's conservative circles like the federal carbon tax policy, the party's signature climate policy that critics argue is a financial burden for Canadians. He has also been critical of Poilievre, saying the Conservative leader's vision for the future of the country is "without a plan" and "just slogans". Other candidates believed to be credible replacements for Trudeau include his former deputy Chrystia Freeland, who resigned from the cabinet after a rift with the prime minister's office in December, and Transport Minister Anita Anand, a lawyer who was elected in 2019.

The Arctic recently made headlines after Donald Trump repeated his desire to buy Greenland. Trump cited national security interests, but for many the territory's vast mineral wealth is the main attraction. Yet economic development elsewhere in the vast polar region has ground to a halt. Working conditions in the Arctic Ocean are extremely challenging at this time of the year for Norwegian fisherman Sondre Alnes-Bonesmo. The sun last rose at the end of October, and it is not due to appear in the sky again until the middle of February. In addition to the endless dark, temperatures can plummet below minus 40C, and storms can bring vast waves. Mr Alnes-Bonesmo, 30, works two six-hour shifts a day, during five-week tours on a ship called Granit. One of the largest factory trawlers fishing in Arctic waters north of Norway, and off the coast of Greenland, it doesn't stop for winter. Unsurprisingly, he prefers the endless daylight of summer. "I do like it when the weather is nice, as we're not sent crashing into the walls and such, the way we are during storms, when the waves can be fairly big," he grins in understatement. Mr Alnes-Bonesmo is a participant in the so-called Arctic "cold rush". A play on words with gold rush, it began in earnest around 2008 when a series of reports identified vast mineral and hydrocarbon reserves across the Arctic region. Reserves that, together with large fishing stocks, could continue to become more accessible as climate change reduces ice levels. This reduction in ice has also increasingly opened up Arctic sea routes, north of the Canadian mainland and Russia. So much so that, in the decade from 2013 to 2023, the total recorded annual distances sailed by ships in the Arctic Sea more than doubled from 6.1 million to 12.9 million miles. The hope in the longer term is that cargo ships can travel from Asia to Europe and the east coast of the US, through Arctic waters above Canada and Russia. But the question Mr Alnes-Bonesmo now asks himself is this – did he arrive too late? Following Russia's invasion of Ukraine in 2022 much of the planned economic development of the Arctic region ground to a halt as relations between Russia and the West deteriorated. "Russia had great plans in the Arctic," says Morten Mejlaender-Larsen, Arctic operation and technology director from Norwegian firm DNV. His company sets rules and standards for the maritime sector. "They began constructing regional rescue centres complete with ships and helicopters to facilitate both destination shipping for gas, oil and coal projects in Siberia, as well as for shipping along the Northeast Passage [north of Russia]. "[But] since the invasion of Ukraine, international shipping in the Northeast passage has all but stopped, apart from a few Chinese ships," observes Mr Mejlaender-Larsen. He adds that Norway has also halted oil and gas exploration in the region. "It's completely stopped," he says. "We don't expect to see any further developments in the Barents Sea north of Bear Island." This small Norwegian island is some 400km (250 miles) north of Norway's mainland. Norway's scaled back ambitions in the Arctic have pleased environmentalists who have consistently warned about the impact of drilling for hydrocarbons on both wildlife and the fragile environment of the polar region. Last month Greenpeace welcomed the decision of the Norwegian government to stop the first round of licensing for deep sea mining in Arctic waters between Norway's Svalbard and Jan Mayen islands. Commentators say that while poor relations with Russia is a key reason why Norway is wary of ploughing money into Arctic projects, its interest in the polar region had already cooled. Helene Tofte, director of international cooperation and climate at the Norwegian Shipowners Association, says that in hindsight the outlook for shipping in the Arctic had been "exaggerated". She points out that despite the impact of climate change, the Arctic remains a difficult place in which to operate. "Conditions in the Arctic can be extremely challenging, even when the absence of sea ice allows passage," she says. "Large parts of the route are far from emergency response capacities, such as search and rescue, and environmental clean-up resources. "Increased shipping in this area would require substantial investments in ships, emergency preparedness, infrastructure, and weather forecasting systems, for a route that is unpredictable and has a short operational season. At present, we have no indication that our members view this as commercially interesting." Mr Mejlaender-Larsen points to a "belief that thanks to global warming there'll be summers up there. That'll never happen. If it's minus 40C and it gets 3C warmer, it's still not warm." Moreover, Prof Arild Moe, from Norwegian research group Fridtjof Nansen Institute, says the entire cold rush of the Arctic was based on exaggerated assumptions. "The exuberance was excessive," says the expert on oil and gas exploration in the region. "What the reports from 2008 referred to weren't actual reserves, but potential and highly uncertain resources, which would be risky, expensive, and difficult to locate and exploit." Regarding Trump's renewed interest in Greenland, an autonomous Danish territory, authorities in Greenland and Denmark were again quick to reply that it was not for sale. Prof Moe says that Trump's "crude and undiplomatic statement" shows that the US under Trump eyes both security and economic interests in the island, including its "rich mineral resources". The Danish government also responded by announcing a huge increase in defence spending for Greenland. Elsewhere in the Arctic, Trump is expected to allow increased oil and gas exploration in Alaska, specifically in the resource rich Arctic National Wildlife Refuge. This 19 million acre expanse is the US's largest wildlife refuge, and back in 2020 Trump authorised drilling in one section of it. Meanwhile, Canada is continuing to build a deep-water port at Grays Bay, on the north coast of Nunavut, its most northern territory. Grays Bay is approximately in the centre of the so-called Northwest Passage, the Arctic sea route north of the Canadian mainland. Back on the Granit fishing ship, Mr Alnes-Bonesmo says that, while he has earned good money, fishing quotas continue to go down to try to preserve stocks in Norwegian Arctic waters. Nevertheless, he is philosophical. "After a few years at sea I've grown more scared of the Arctic Ocean, but I've also come to respect and value it for all its power and beauty."

Canadian Prime Minister Justin Trudeau could announce his resignation within days, according to media reports. He is considering stepping down as leader of the governing Liberal Party, which could also bring to an end his nine years as prime minister. Last month Trudeau's finance minister quit, citing policy disagreements such as how to deal with Donald Trump's threat to levy US tariffs on Canadian goods. He is expected to hold a news conference at 10:45 local time (15:45 GMT) on Monday. Trudeau's popularity has also plummeted among voters, with polls suggesting his party is on course for a general election defeat this year. The Globe and Mail reports that he could announce his intention to quit before his party's national caucus meets on Wednesday, to avoid the perception that his own MPs forced him out. Their sources said it was unclear whether Trudeau would leave immediately or stay on as prime minister until a new leader was selected. And they stressed he had yet to make a final decision on his future. Whoever takes over will have to lead the party through an election campaign while also navigating a possible trade war with the US. The election must take place before October, but a change in leadership of the Liberal Party could increase calls for a snap vote in the coming months. Faced with turmoil, a defiant Trudeau hangs on - for now Four paths Trudeau can take as political crisis deepens Trudeau's departure would bring to an end a defining era in Canadian politics. He unexpectedly swept his party to power in 2015, winning a campaign that began with them in third place. The fresh-faced young leader, aged 43 back then, promised a new kind of politics centred on an open immigration policy, increased taxes on the wealthy and battling climate change. But his first term was dogged by scandals. In more recent years, he had been battling sinking popularity as frustration grew with the cost of living and his own style of governing. Dozens of Liberal MPs in Quebec, Ontario and Atlantic Canadian provinces have called for him to step down, while polls suggest two-thirds of voters disapprove of him. Just 26% of respondents in a September Ipsos survey said Trudeau was their top pick for prime minister, putting him 19 points behind Conservative leader Pierre Poilievre. History is also not on Trudeau's side, with only two prime ministers ever serving four consecutive terms. Poilievre rose to the top of his party in 2022 on a promise to reduce taxes, tackle inflation and protect individual liberties. The 45-year-old also rallied support behind the Freedom Convoy truckers protesting about Covid mandates - a blockade that brought Canadian cities including Ottawa to a standstill. Canada's next prime minister will have to address the threat of tariffs from incoming US President Donald Trump. He has vowed to impose a 25% tariff on Canadian goods if the country does not secure its shared border to the flow of irregular migrants and illegal drugs. The "grave challenge" this posed was referred to in the resignation letter of Finance Minister Chrystia Freeland, who quit hours before she was due to deliver her annual budget. She said Trudeau had informed her he no longer wanted her to be his government's top economic adviser.

Every morning I've woken up as prime minister, I've been inspired by the resilience, the generosity, and the determination of Canadians. It is the driving force of every single day I have the privilege of serving in this office. That is why, since 2015, I have fought for this country - for you - to strengthen and grow the middle class. Why we rallied to support each other through the pandemic, to advance reconciliation, to defend free trade on this continent, to stand strong with Ukraine and our democracy. And to fight climate change and get our economy ready for the future. We are at a critical moment in the world. My friends, as you all know, I am a fighter. Every bone in my body has always told me to fight because I care deeply about Canadians. I care deeply about this country. And I will always be motivated by what is in the best interest of Canadians. And the fact is, despite best efforts to work through it, parliament has been paralysed for months after what has been the longest session of a minority parliament in Canadian history. That's why, this morning I advised the governor general that we need a new session of parliament. She has granted this request and the house will now be prorogued until 24 March. Over the holidays, I've also had a chance to reflect and have had long talks with my family about our future. Throughout the course of my career, any success I have personally achieved has been because of their support and with their encouragement. So last night over dinner, I told my kids about the decision that I'm sharing with you today. I intend to resign as party leader, as prime minister, after the party selects its next leader through a robust, nationwide, competitive process. Last night I asked the president of the Liberal Party to begin that process. This country deserves a real choice in the next election and it has become clear to me that if I'm having to fight internal battles, I cannot be the best option in that election. The Liberal Party of Canada is an important institution in the history of our great country and democracy. A new prime minister and leader of the Liberal Party will carry its values and ideals into that next election. I am excited to see the process unfold in the months ahead. We were elected for the third time in 2021 to strengthen the economy post-pandemic and advance Canada's interests in a complicated world, and that is exactly the job that I, and we, will continue to do for Canadians.